Time to read : 3 Minutes
You might have seen the steady stream of Tik Tok videos of so-called financial experts spruiking what the benefits of saving or investing one dollar a day might be, or what happens if you paid one dollar a day extra on your mortgage.
When it comes to advice found online, applying some critical thinking is always recommended.
Not all of those people with a Tik Tok account have their numbers correct.
But … any amount of money that can be saved or invested has the potential to return more money.
What happens if you put $1 a day into your bank account?
The answer to that question depends on interest rates or rates of return.
With no interest involved, putting one dollar a day into a bank account (or a jar at home) will see you end up with $365 in a year.
Multiply that amount by 30 years and you’ll end up with $10,950.
Now let’s factor in an interest rate of just 1%.
If you deposited one dollar a day for 30 years, that $10,950 would earn interest of $1791 over 30 years, giving you a grand total of $12,593.
Bump that interest rate up to 3% and it makes a significant difference.
Over the same period of time, that one dollar a day will earn $6690 in interest over 30 years and you’ll end up with $17,492.
If you manage to secure a 5% interest rate, your 30 years of adding one dollar a day will earn you $14,186 in interest, with the end result tallying $24,989.
See, compound interest is your friend.
But with other ways to invest a dollar a day, your results can be even greater.
What happens if you invest $1 a day?
The Standard and Poor's 500 (known as the S&P 500) is a stock market index that tracks the stock performance of 500 of the largest companies listed on the United States stock exchange. It’s one of the world’s most commonly followed equity indices.
The history of the S&P 500 shows an average annualised return of almost 12% since it started decades ago. To simplify, let’s work with a 10% annual return on your one dollar a day over 30 years and you will end up with a whopping interest profit of $57,124 – and a grand total of $67,926.
The bottom line
Doing something with your money can make you more money. Even locking it away in a bank account out of reach at a low interest rate helps you save, because you don’t have it in your pocket to spend on that second cup of coffee you really don’t need.
And, yes, 30 years might seem like a long time away. But you will be 30 years older before you know it. When you eventually get there, life could be sweeter with some extra savings.
Even if you don’t think it will make much difference to your own retirement planning down the track, it can be a cute (and productive) way to set savings aside for your children or grandkids.
Go deeper:
How to save money with your spare change
A Guide to Buying Your First Home
Financial disclaimer
The information contained on this web page is of general nature only and has been prepared without taking into consideration your objectives, needs and financial situation. You should check with a financial professional before making any decisions. Any opinions expressed within an article are those of the author and do not specifically reflect the views of Compare Club Australia Pty Ltd.
FAQs
With no interest involved, putting one dollar a day into a bank account (or a jar at home) will see you end up with $365 in a year. Multiply that amount by 30 years and you'll end up with $10,950. Now let's factor in an interest rate of just 1%.
What happens if you save $1 dollar a day? ›
Save $1 a Day in a Savings or Money Market Account
So, if you saved $1 a day in a savings or money market account earning 1.00 percent interest compounded daily, you would have $23,646 after 50 years.
How much money would you have if you got $1 dollar a day? ›
Your $1 a day could turn into more money than you think
| After… | Your $1 a day will be worth… |
|---|
| 5 years | $2,451.20 |
| 10 years | $6,398.88 |
| 20 years | $22,995.91 |
| 30 years | $66,044.35 |
Jan 16, 2024
Currently, 1 billion people worldwide live on less than one dollar a day, the threshold defined by the international community as constituting extreme poverty.
What is save $1 on day one and increase your savings by a dollar each day? ›
What is the #SaveUpChallenge? The #SaveUpChallenge is a simple 30 day challenge designed to get you to save $465. Save $1 on day one and increase your savings by a dollar each day. After 30 days, you'll have saved $465!
How much will $1 be worth in 20 years? ›
Real growth rates
| One time saving $1 (taxable account) | Every year saving $1 (taxable account) |
|---|
| After # years | Nominal value | Nominal value |
|---|
| 20 | 3.56 | 41.02 |
| 25 | 5.00 | 62.94 |
| 30 | 7.07 | 93.87 |
7 more rowsMatch each week's savings amount with the number of the week in your challenge. In other words, you'll save $1 the first week, $2 the second week, $3 the third week, and so on until you put away $52 in week 52.
How much is $1 a day for a year? ›
If you saved $1 a day for a year, do you know how much money you'd have? Roughly $30,000. This is totally 100% true.
How much is $10 dollars a second for a day? ›
$10 per second × 60 seconds = $600 per minute × 60 minutes= $36,000 per hour × 24 hours = $ 864,000 per day . You'd male over a million in 2 days or I believe in less than 1 day 6 hours or 30 hours, you would make over 1 million. $1,080,000 to be exact you would make in 30 hours. 10 dollar per second!
How much is $100 everyday for a year? ›
$100 daily is how much per year? If you make $100 per day, your Yearly salary would be $26,031. This result is obtained by multiplying your base salary by the amount of hours, week, and months you work in a year, assuming you work 40 hours a week. How much tax do I pay if I make $100 per day?
The World Bank reports that 712 million people, nearly 1 in 11 people globally, live on less than $2.15 a day. As of 2022, the poverty rate in the United States was 11.5%, with approximately 37.9 million people living in poverty.
Where will they be living on one dollar a day? ›
Premise. The film follows the experience of four young friends as they live on less than $1 a day for two months in rural Guatemala.
How much would I have if I save a dollar a day? ›
Over the same period of time, that one dollar a day will earn $6690 in interest over 30 years and you'll end up with $17,492.
What is the 52 week rule? ›
Start with the base amount you want to save each week, then the rule adds $1 every week for a year. For example, if you start with $5 on week one, you'll save $6 on week two, $7 on week three, and so on for 52 weeks. In a year's time, you would save a total of $1,568.00.
What is the 52 week method? ›
There are no complicated rules to remember. Week 1, you save $1.00. Week 2 you save $2.00, and it continues through the year, adding one more dollar to each week's savings goal. By Week 52, you'll set aside $52.00, which will bring the year's total savings to $1,378!
What if I save $5 dollars a day? ›
If you put aside $5 per day, that's approximately $150 per month. And over the course of 30 years, you will have saved around $55,000 total. While that's a good chunk of change, it isn't $1 million or anywhere near it. The key is to invest those savings in a growth-focused ETF like the Invesco QQQ Trust.
How much is a dollar a day for 18 years? ›
Because of compounding, time can be more valuable than money, so even a little money can go a long way. For example, investing just $1 per day from birth can lead to more than $13,000 by the time your child turns 18 and may be ready to go to college or to start a career.
Is it good to save $10 a day? ›
The $10 a day adds up to $3,650 a year -- which is a pretty good sum of money. And, once you have invested that money, you get to benefit from compound growth. That's when your investments earn returns that are reinvested so you earn even more money going forward.
